Friday, November 23, 2012

But I failed. I don't want to waste your time tonight - there were no press releases I found interesting so it's back to business full time Monday. Nice to see gold up $20 and silver up $.75. Have a great weekend!
stateside

Happy Thanksgiving Eve,
I don't have time for a video tonight but there were 3 press releases that you may want to look at tonight. Atac Resources (ATC) announced additional drilling results from their Rackla project. Bengal Energy (BNG) announced a new oil discovery in the Cooper Basin of Australia and Chalice Gold Mines (CXN) announced assays from their Mogoraib drilling.
On the value play, Opawica (OPW) announced the start of drilling on their Teck-Kirkland project. They are trading at $.035 and have 110 million shares out for a $4 million market cap. They own 9.9 million shares of San Gold (SGR) which trades at $.92/share so they have $9 million of shares that they can sell in January 2013. The market as in so many cases doesn't care.
Happy Thanksgiving!

Sunday, November 11, 2012

While the bankrupt Canadian and US banks continue to sell paper gold, the Chinese continue to accumulate physical gold as the time draws closer when the western financial world runs out of gold to sell. At that point, it is game over.
Link here

More discussion on production and pricing in the Q&A (below).
Looks like Watford is forecasting production to start falling in a couple months, then to continue to fall for 2 years until we have $5+ natgas to spur investment...and this comes from the company that claims the lowest cash cost of production.
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…David R. Tameron - Wells Fargo Securities, LLC, Research Division
If you got what you're looking for as far as the $4. And as you have been consistent about that and saying how much better the economics are, with the uplift, why not go ahead and lock in some hedges for '14 today and secure that CapEx budget?
Michael D. Watford - Chairman, Chief Executive Officer and President
Well, because I think the upside is greater. I think it's limited the downside -- upside. I don't think people are properly forecasting gas supply reductions.
David R. Tameron - Wells Fargo Securities, LLC, Research Division
All right. But no -- I guess, I'm looking at -- obviously, you're running the company, you're making decisions, but why double down at this point? You've got the gas price rebound you're looking for and why not take some that risk off the table?
Michael D. Watford - Chairman, Chief Executive Officer and President
Again, because the upside looks greater. I mean, we still have bottom, but we're nowhere near bouncing back up to where we need to be. There's just not going to be any significant investment in dry natural gas wells at $4 gas, not going happen. So I think we're probably in a 2-year window here before we get gas prices back at $5 plus to where you growth and investment I think you're going to continue to see industry-wide investment decrease in 2013 and '14.
…Mark P. Hanson - Morningstar Inc., Research Division
Great. And my follow-up will be, have you had discussions with Shell and Anadarko? And I know it's for 2013 and beyond, but at what point do you think they start to ramp back up in the Marcellus? And is there a floor at which you'd choose to not consent versus participating there?
Michael D. Watford - Chairman, Chief Executive Officer and President
I won't speak for Shell, but I think Anadarko didn't have any intentions of ramping back up probably until you get closer to $5 gas price. So I think 2013 and certainly 0 activity and depending on where the 2014 gas prices the, when you're this the next year, will dictate what happens then. And that's my point about I think for a 3-year window here of decreasing supply because I think majority of the folks have drastically cut back going through the budget cycle in 2013. And those cutbacks are going to continue or be worse. I mean you've seen them average through the course of 2012. You're going to see them at a very low level for 2013. And then when you go budgeting cycle for 2014, your gas prices are $5 or above for '14. You'll see that continue if they are, and they start to spend back up, you don't even get a production increases based on the capital spend uplift in 2014 to late third quarter or fourth quarter of 2014. So I think we've got 24 months of maybe we have another couple of months of flat production. But after that, it starts coming down, and it keeps coming down for the next 2 years.
source:
http://seekingalpha.com/article/969751-ultra-petroleum-management-discusses-q3-2012-results-earnings-call-transcript?page=1

Sunday, November 4, 2012

Now that the precious metals have been taken out back and beaten like a rented mule in the run-up to the Tuesday elections, it's time to sit back and see what happens. I'll have a video Monday night then take Tuesday night off for the elections. As Jim Sinclair stated this weekend, on Tuesday we find out if gold hits $3,000 per ounce in 6-9 months or by 2015. It's not a matter of if, it's a matter of when.